Engineering services confident despite rising costs

The latest BESA/ECA/SELECT/SNIPEF quarterly sector-wide Building Engineering Business Survey, sponsored by Scolmore, found that over three in four engineering services organisations (77 percent) say turnover increased or remained steady in Q2 2018, despite rising material and labour costs.

Compared to Q1 2018, almost two thirds (62 percent) of respondents reported an increase in material costs, and nearly half (45 percent) reported an increase in labour costs in Q2.

Retentions were held against 61 percent of businesses, and late payment remains an issue for over half of respondents in commercial and public sector work.

The overall outlook for Q3 appears positive and optimistic; nearly nine out of 10 (88 percent) respondents predict their turnover will grow or remain steady for the quarter.

ECA deputy director of business policy and practice, Rob Driscoll, said: “As we move into the second half of 2018, the effects of Carillion’s January collapse are still surfacing but overall, the second quarter showed further steady growth, with a positive outlook for the next quarter.

“We will continue to push for industry improvements on payment and retentions and we anticipate that new government requirements for transparent payment reporting will help the industry to address its ongoing poor payment performance.”

BESA public affairs and policy manager, Alexi Ozioro, added: “It is encouraging to see growth among members and a more optimistic outlook for the sector. For a long time, however, members have been concerned about rising material costs. The announcements of government’s preparations for a no-deal Brexit do not address these concerns, instead introducing further uncertainty into the market. We will be closely monitoring the situation, to see if enough has been done to minimise disruption and ensure a smooth and orderly exit in all scenarios.”

Darrell Matthews, managing director of SELECT, stated: “It is a tribute to the resilience of both small and large employers that they are generally more optimistic about future work despite rising costs and recurring late payment issues.”

SNIPEF chief executive, Fiona Hodgson, said: “After a challenging start to the year for many of our members, it is heartening to see signs of steady growth in the industry. The industry continues to show resilience. However, there are ongoing challenges that must be addressed to provide certainty for businesses.”  

The survey received 372 responses from companies across the multi-billion pound industry, mainly regarding their performance in Q2 (01 April to 30 June 2018), and expectations for Q3.

30 August 2018


Already Registered?
Sign In
Not Yet Registered?

Pentland Wholesale boosts business development team

Pentland Wholesale Limited has appointed Brendan Murphy as its distributor business development manager covering the South of England, working with and developing the Pentland Wholesale distributor partner network....


Webinar: How to avoid the most common pitfalls when installing HVAC sensors

Choosing the right instrument for your HVAC application and needs is important, but it is just as vital to make sure that your HVAC device is installed correctly, says Vaisala....


Fridgenius Ltd - New Website Launched!

The new Fridgenius Ltd Website has been launched, please visit for more information about our SOLENOID VALVE OPERATING MAGNETS!
ACR News is the number one magazine in the air conditioning and refrigeration industry. Don’t miss out, subscribe today!
Subcribe to ACR News


Refrigeration & A/C Equipment Sales Engineer – South East

Thermofrost Cryo is one of the UK’s leading distributors of refrigeration and air conditioning products, selling across the whole of the UK, with offices in London, Birmingham and Manchester....


ASHRAE Winter Conference
ASERCOM Convention
IOR Annual Dinner 2019
ACR News Awards